You may have seen the terms “loan modification software” and “loan modification help” thrown around and you’re wondering what it’s all about exactly. To take a little step back, a loan modification refers to a change made to the terms and/or conditions of a mortgage so that it ultimately results in a more affordable and beneficial scenario for the homeowner in question, such as the reduction of your mortgage payment through reducing the interest rate on your loan, and/or by extending the loan term to 30 or even 40 years from the current period.
The loan modification process can be unnecessarily complex, and an effective loan modification software tool can assist the applicant with submitting the best prepared application package possible through properly adhering to all the loan modification guidelines. Here’s how:
- Understanding and entering your gross income correctly.
Makes a huge difference to your eligibility for either a HAMP or private loan modification, especially when you are self-employed. A lot of self-employed people make the mistake of thinking that their gross revenue from their business is the same as their gross income, but it is not. Your Net revenue after expenses could be your actual gross income. You also have to take into consideration whether your net profit is the same as your net income. MyCaal loan modification software allows you to input your financial data accurately, and we will calculate the rest for you; this means that you will be able to understand all these differences which are easy to get confused about and misrepresent. It also helps you avoid making mistakes when preparing your financial worksheet and talking with your lender. Additionally, we have personally coached people, and during the application process we’ve witnessed even bank underwriters mistake gross revenue from business as gross income, nearly foreclosing on the applicant incorrectly in the process. We intervened. How is it possible that banks don’t follow these basic accounting standards? Whatever the reason, the impact on the homeowner can be disastrous.
- Income Property
Another very common mistake associated with the home loan modification application process is not understanding how to represent your income from rental properties. Again, many bank underwriters will by default add the income you receive from rental property to your gross income, therefore erroneously exaggerating your gross income and potentially disqualifying you from obtaining a loan modification. If for example, your expenses linked to your rental property are higher than the rent you are receiving, then this income should not be viewed as income at all, but instead, the net amount should be considered to be an expense or debt. For example, if you are receiving $1000/month in rental income, and your expenses are $500, and given the fact that the bank will only take into consideration 75% of the income because they always put aside 25% for vacancy, the net income here should not be viewed as $1000, but rather (1000 * 75% – $500) which is equal to $250. This point can easily can determine the success or failure of your application. MyCaal helps you avoid mistakes like these and helps you identify when your bank is making a similar miscalculation as well. This is because MyCaal prepares your financial summary and explains its components in a way that is easy to grasp.
- The power of pre-qualification knowledge
If you know what you should be entitled to based on your adherence to the relevant guidelines of the loan modification program, then you are better equipped to obtain the outcome that you qualify for. Homeowners applying without knowledge of their pre-qualification status are forced to do so in the dark, and they are totally at the mercy of the behind-the-scenes calculations and procedures of their bank. If you know that you pre-qualify, you can submit your application with confidence, and communicate with your bank boldly if and when the time comes to do so.
There simply is no better way to achieve loan modification approval than with the empowering assistance of our loan modification software. For more information on MyCaal loan modification software details, please refer to this article we have posted in our Guide section: loan modification software. With MyCaal in your corner you take the gamble out of the application process and ensure that you receive a result based on solid facts as opposed to speculation and processing error.
About Carla Ghosn
|CEO and Founder of MyCaal.com, earnestly helping American homeowners save their home. If you need loan modification help, visit www.mycaal.com to access loan modification software that helps you get pre-qualified and prepares your loan modification package online.|